quiz

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On January 1 2017 Lemon industries had shares outstanding as follows;

6$ cumulative preferred, no-par value $1,000,000

issued and outantding 10,000

Common no-par value, issued and $2,150,000

outstanding 215,000

At the beginning of the year, to acquire the net assets of 3 smaller companies, Lemon authorized the issuance of an additional 160,000 common shares, as follows :

Date of acquisition shares issued

Cie A January 1 2017 50,000

Cie B January 1, 2017 80,000

Cie C January 1, 2017 30,000

1) On December 31, Lemon recorded a net income of $ 300,000. Compute the earnings-per-share data that should appear on the financial statements.

2) Compute the earnings-per-share if the preferred shares had been non-cumulative.